XML 36 R19.htm IDEA: XBRL DOCUMENT
v3.25.4

Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2025
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes The Company recorded income tax expense of $1.2 million during the year ended December 31, 2025. Of the $1.2 million recorded, $0.4 million was related to foreign withholding taxes on the milestone payments received in connection with the Huadong Agreement and the remaining related to U.S. state income tax expense and other foreign tax expense. The Company recorded income tax expense of $0.6 million during the year ended December 31, 2024. Of the $0.6 million recorded, $0.5 million was related to foreign withholding taxes on the up-front fee in connection with the Huadong Agreement and the remaining was related to other foreign tax expense. The Company recorded income tax expense of $3.1 million during the year ended December 31, 2023. Of the $3.1 million recorded, $3.0 million was related to foreign withholding taxes on the up-front fee in connection with the Huadong Agreement and the remaining was related to other foreign tax expense. A reconciliation of loss before income taxes for domestic and foreign locations for the years ended December 31, 2025, 2024 and 2023 (in thousands):
| Year Ended December 31,
| 2025 |  | 2024 |  | 2023
United States | $ | (8,244) |  |  | $ | (130,372) |  |  | $ | (255,653) |
Foreign | (6,726) |  |  | (9,020) |  |  | (3,374) |
Loss before income taxes | $ | (14,970) |  |  | $ | (139,392) |  |  | $ | (259,027) |
A reconciliation of provision for income taxes for the years ended December 31, 2025, 2024 and 2023 is as follows (in thousands):
| Year Ended December 31,
| 2025 |  | 2024 |  | 2023
Current tax provision: |  |  |  |  |
Federal | $ | — |  |  | $ | — |  |  | $ | — |
State | 273 |  |  | — |  |  | — |
Foreign | 844 |  |  | 799 |  |  | 3,113 |
Total current | 1,117 |  |  | 799 |  |  | 3,113 |
Deferred tax provision: |  |  |  |  |
Federal | — |  |  | — |  |  | — |
State | — |  |  | — |  |  | — |
Foreign | 54 |  |  | (152) |  |  | — |
Total deferred | 54 |  |  | (152) |  |  | — |
Provision for income taxes | $ | 1,171 |  |  | $ | 647 |  |  | $ | 3,113 |
A reconciliation of income tax computed at federal statutory rates to the reported provision for income taxes for the years ended December 31, 2025, 2024 and 2023 is as follows (in thousands)(1):
| Year Ended December 31,
| 2025 |  | 2024 |  | 2023
Tax U.S. federal statutory rate | $ | (3,144) |  | 21.0 | % |  | $ | (29,272) |  | 21.0 | % |  | $ | (54,396) |  | 21.0 | %
State and local income tax, net of federal income tax effect(2) | 836 |  | (5.6) | % |  | (11,367) |  | 8.2 | % |  | 1,512 |  | (0.6) | %
Foreign tax effects |  |  |  |  |  |  |  |
United Kingdom |  |  |  |  |  |  |  |
Statutory tax rate differential | (319) |  | 2.1 | % |  | (389) |  | 0.3 | % |  | (160) |  | 0.1 | %
Change in valuation allowances | 2,071 |  | (13.8) | % |  | 2,427 |  | (1.7) | % |  | 999 |  | (0.4) | %
Other | (77) |  | 0.5 | % |  | — |  | — | % |  | — |  | — | %
China | 402 |  | (2.7) | % |  | 500 |  | (0.4) | % |  | 3,000 |  | (1.2) | %
Other | 233 |  | (1.6) | % |  | — |  | — | % |  | (6) |  | — | %
Tax credits | (1,288) |  | 8.6 | % |  | (804) |  | 0.6 | % |  | (4,763) |  | 1.8 | %
Change in valuation allowances | (3,145) |  | 21.1 | % |  | 37,731 |  | (27.1) | % |  | 52,716 |  | (20.2) | %
Nontaxable or nondeductible items |  |  |  |  |  |  |  |
Sec. 162(m) limitation | 1,426 |  | (9.5) | % |  | 633 |  | (0.5) | % |  | 3,386 |  | (1.3) | %
Stock-based compensation | 3,197 |  | (21.4) | % |  | (185) |  | 0.1 | % |  | 1,787 |  | (0.7) | %
Other | 857 |  | (5.7) | % |  | 654 |  | (0.5) | % |  | (95) |  | — | %
Other adjustments | 122 |  | (0.8) | % |  | 719 |  | (0.5) | % |  | (867) |  | 0.3 | %
Provision for income taxes | $ | 1,171 |  | (7.8) | % |  | $ | 647 |  | (0.5) | % |  | $ | 3,113 |  | (1.2) | %
(1) The prior years included in the effective tax rate table have been recast from the financial statements filed previously to align with the new presentation created through adherence to ASU 2023-09. Consideration has only been given to 2025 amounts in terms of the balances that are separately stated within the table. (2) The states and local jurisdictions that contribute to a majority (greater than 50%) of the tax effect in this category include Texas, California and New York based on the distribution of sales and the current year state income tax obligations. The components deferred tax assets and liabilities were as follows (in thousands):
| December 31,
| 2025 |  | 2024
Deferred tax assets: |  |  |
Net operating loss carryforwards | $ | 180,809 |  |  | $ | 171,681 |
Intangibles | 1,958 |  |  | 1,400 |
Research and development tax credits | 15,698 |  |  | 14,944 |
Research and expenditure capitalization | 23,848 |  |  | 36,255 |
Accruals and reserves | 25,226 |  |  | 16,085 |
Lease liability | 1,413 |  |  | 837 |
Stock-based compensation | 7,744 |  |  | 15,761 |
Gross deferred tax assets | 256,696 |  |  | 256,963 |
Less valuation allowance | (255,482) |  |  | (256,270) |
Net deferred tax assets | 1,214 |  |  | 693 |
Deferred tax liabilities: |  |  |
Property and equipment | — |  |  | (58) |
Right-of-use asset | (1,110) |  |  | (483) |
Gross deferred tax liabilities | (1,110) |  |  | (541) |
Total net deferred tax assets | $ | 104 |  |  | $ | 152 |
The Company regularly evaluates the positive and negative evidence in determining the realizability of its deferred tax assets. Based upon the weight of available evidence, which includes historical operating performance and reported cumulative net losses since inception, a valuation allowance on the majority of net deferred tax assets has been recorded as of December 31, 2025 and 2024. The Company intend to maintain its substantially full valuation allowance on its deferred tax assets until sufficient positive evidence exists to support reversal of the valuation allowance. The Company has an immaterial deferred tax asset related to a foreign jurisdiction. The valuation allowance decreased by approximately $0.8 million and increased by approximately $40.1 million during the years ended December 31, 2025 and 2024, respectively, due to similar changes in the underlying deferred tax asset balances. The Company has net operating loss (NOL) carryforwards for federal and state income tax purposes of $761.3 million and $636.1 million, respectively, as of December 31, 2025. Of the federal NOLs, $3.5 million originated before the 2018 tax year and will expire beginning in 2036. Under the Tax Cuts and Jobs Act of 2017, the remaining $757.8 million of NOLs generated after December 31, 2017 will be carried forward indefinitely and will be available to offset 80% of taxable income in future years. Of the $636.1 million in state net operating loss carryforwards, $550.2 million will begin to expire in 2027 and the remaining NOLs carry forward indefinitely. In addition, the Company has foreign NOL carry forwards of $23.2 million as of December 31, 2025, which can be carried forward indefinitely. As of December 31, 2025, the Company also had federal and California research and development tax credit carryforwards of $23.2 million and $4.6 million, respectively. The federal research and development tax credit carryforwards will begin to expire in 2037. The California research and development tax credit carryforwards are available indefinitely. Under Internal Revenue Code Sections 382, as amended, and 383, substantial restrictions exist on the utilization of tax attributes in the event a corporation experienced an “ownership change.” Generally, a Section 382 “ownership change” occurs if one or more stockholders or groups of stockholders who owns at least 5% of a corporation’s stock increases its ownership by more than 50 percentage points over its lowest ownership percentage within a specified testing period. Accordingly, the Company's ability to utilize net operating loss and tax credit carryforwards may be limited as a result of such ownership changes, and such a limitation could result in the expiration of carryforwards before they are utilized. The Company has completed Section 382 studies that concluded the Company has experienced ownership changes since inception. However, this is not expected to result in the expiration of federal tax attribute carryforwards prior to utilization. Similar rules may apply under state tax laws. On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted into law. The OBBBA contains numerous business tax provisions, including business extenders made permanent such as restoration of 100% bonus depreciation, IRC Section 174 expensing for US-based research, and the EBITDA-based business interest expense limitation under Section 163(j). The enacted legislation had an immaterial impact on the Company’s effective tax rate for the year ended December 31, 2025. The following table summarizes the activity related to the unrecognized tax benefits (in thousands):
| Year Ended December 31,
| 2025 |  | 2024 |  | 2023
Beginning balance | $ | 42,286 |  |  | $ | 41,390 |  |  | $ | 42,505 |
Increases related to tax positions taken during a prior year | 403 |  |  | — |  |  | — |
Decreases related to tax positions taken during a prior year | (91) |  |  | (131) |  |  | (3,097) |
Increases related to tax positions taken during the current year | 784 |  |  | 1,027 |  |  | 1,982 |
Ending balance | $ | 43,382 |  |  | $ | 42,286 |  |  | $ | 41,390 |
Included in unrecognized tax benefits of $43.4 million at December 31, 2025 was $36.2 million of tax benefits that, if recognized, would not impact the Company's income tax benefit or effective tax rate to the extent that the Company continues to maintain a full valuation allowance against its deferred tax assets. The Company files tax returns in the United States, state jurisdictions, Canada, and the United Kingdom. The tax years for 2016 and forward are subject to examination by the U.S. tax authorities and the tax years for 2016 and forward are subject to examination by the state tax authorities. Due to net operating loss carryforwards and research and development credits in the United States and state tax jurisdictions, all years effectively remain open. The Company is subject to examination by the tax authorities in Canada and the United Kingdom for the year ended December 31, 2022 to the present period. It is the Company's policy to recognize interest and/or penalties related to uncertain tax benefits as a component of the provision for income taxes. For the years ended December 31, 2025, 2024 and 2023, the Company has not recognized any interest or penalties related to income taxes. The Company has no accrued interest and penalties as of December 31, 2025 and 2024 due to available tax losses. The amount of cash income taxes paid were not material for the years ended December 31, 2025, 2024 and 2023.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for income tax. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 942 -SubTopic 740 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147477617/942-740-50-1 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org/1943274/2147480738/235-10-S50-1 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 944 -SubTopic 740 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147478822/944-740-50-1 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-12 Reference 5: http://www.xbrl.org/2003/role/exampleRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 231 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482663/740-10-55-231 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12C -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-12C Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12B -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-12B Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 270 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org/1943274/2147477891/740-270-50-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SAB Topic 6.I.5.Q1) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479360/740-10-S99-1 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Publisher FASB -URI https://asc.fasb.org/1943274/2147480990/946-20-50-13 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480678/235-10-S99-1 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/740/tableOfContent Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-14 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-21 Reference 15: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 17 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-17 Reference 16: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479360/740-10-S99-2 Reference 17: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482603/740-30-50-2 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration